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Share Name | Share Symbol | Market | Type | Share ISIN | Share Description |
---|---|---|---|---|---|
Advance Visual | LSE:ACV | London | Ordinary Share | GB0002565355 | ORD 0.1P |
Price Change | % Change | Share Price | Bid Price | Offer Price | High Price | Low Price | Open Price | Shares Traded | Last Trade | |
---|---|---|---|---|---|---|---|---|---|---|
0.00 | 0.00% | 0.16 | 0.00 | 01:00:00 |
Industry Sector | Turnover | Profit | EPS - Basic | PE Ratio | Market Cap |
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0 | 0 | N/A | 0 |
RNS Number:1088L Advance Visual Communications PLC 4 October 2001 Embargoed until 7.00 am 4 October 2001 Advance Visual Communications plc Preliminary Results for the year ended 30 June 2001 Highlights * Successful completion of move from Ofex to AIM, raising #5 million of new funds * Delivered on IPO strategy to establish pan-European presence. Company now operational in five key European cities including Europe's three largest IT services markets, namely the UK, Germany and France, as well as Switzerland. * Revenues for the 12 month period increased by 49% to #2,053,783.(2000: # 1,381,807) * Strong track record for repeat business, with 54% of revenues generated from existing clients and 46% from new clients * Losses for the period increased to #2,616,194 (2000: #1,240,372) reflecting expansion and investment in core business * In anticipation of deteriorating market conditions, group has instigated wide ranging cost reduction initiatives, providing annualised savings of # 1.3m, including savings of #800,000 completed in July and August 2001 * Appointment of new head of sales with 15 years of international experience in institutional sales within the IT and telecomms industry Commenting on the results, Chairman, Barclay Douglas said: "The long-term prospects for the Internet Professional Services and Wireless industry remain good. However, the current lack of visibility over the next twelve months will prove to be a testing challenge." - ends - For further information Massoud Amiri, Chief Executive, Advance Visual 0207 830 9740 David Rydell/Billy Clegg Bell Pottinger Financial 0207 861 3867 Chairman's Statement Preliminary results for the year ended 30 June 2001 In November last year, Advance successfully moved from Ofex onto the AIM market of The London Stock Exchange, raising #5 million at 10p per share. After deducting the cost of the flotation and settling outstanding debts, the company was left with #3.8 million to pursue an expansion strategy aimed at creating a pan-European business. The Board has delivered on its strategy to establish that pan-European presence. In the period under review, we have acquired Webmania in Paris and Click Online in Berlin. In August 2001, we acquired xoo in London. The total aggregate consideration for these businesses amounted to #440,000. All these acquisitions were share based, requiring little cash, and the resultant cumulative dilution of our share capital was less than 8%. As well as satisfying our requirement to have five sales offices covering our centralised production model, the acquisitions firmly established Advance in Europe's three largest IT Services markets, namely the UK, Germany and France, in addition to our existing presence in Switzerland. At present there are no immediate plans for further expansion as the company focuses on driving sales in its five main sales offices. Consequently, the recent decision to open a Zurich office has been reversed without incurring any significant costs. Revenues for the 12 months ending 30 June 2001 were #2,053,783. This is a 49% (annualised) increase over the equivalent 12 months period when sales reached #1,381,807. Some 56% of revenue in the period under review came from the Bradford office, 42% came from Geneva, with the remainder coming from the newly integrated Paris and Berlin offices. Naturally, the 12 months performance of the new acquisitions were not fully reflected whereas they will be more significant contributors to Advance's revenues in the current year. Additionally, 63% of revenues were derived from Internet Projects, which is double the 32% in the previous nine-month period. The portion of Internet services revenues for the second half of the financial year was even higher, at 70%. Digital Video, Multimedia and Events revenues have remained steady. Advance has established a strong track record for repeat business. In the year under review, 54% of revenues were generated by existing clients and 46% by new clients. We also have a current base of 129 clients throughout all of our operations (clients whom we have done work for in the past 6 months). Losses for the year were #2,616,194 compared with a loss of #1,240,372 for the 12 months ending 30 June 2000. More than #200,000 of the 2001 loss was associated with the software division that was closed in December. Other elements of the loss are associated with the legal, financial and operational costs related to the company's rapid European expansion. Otherwise, the increased cost base is mainly associated with increases in staff: an average of 85 employees this year, compared with 45 in the previous period. However, management has achieved rapid expansion, both in terms of revenues and sales offices, while actually decreasing headcount since the IPO. Immediately after the IPO, anticipating deteriorating market conditions, your Board instigated cost cutting initiatives. In December and January, two under performing divisions were closed and headcount was reduced by 19, or 21% of the workforce. Over #500,000 of annualised cost savings was achieved. The full effects of these cost cuts are not reflected in these numbers as the cuts were achieved half way through the period. Since the year-end, a further major cost cutting initiative has been undertaken. In July and August, headcount was reduced by 25 (approximately 30% of our workforce) across all offices. We also cut external services including telemarketing, industry PR and reduced our marketing budget. Annualised savings are expected to exceed #800,000. Consequently, our production centres in Sophia Antipolis (internet and wireless) and Bradford (digital video and multimedia) have been downsized. Only key technical skills have been maintained, and the remainder will be outsourced. The extent of the increased efficiency is best demonstrated by the fact that at the time of IPO we had 91 staff and 2 sales offices whereas shortly we will have under 70 staff sustaining 5 sales offices. To counter the difficult trading environment, management is furthering its proactive sales activities. A new Head of Sales with more than 15 years of international experience in institutional sales within the IT and Telecomm industry has been recruited to assist local offices with their sales activities. Management are also developing Advance's Alliance and Partnership efforts, which we believe will improve our profitability with limited cost exposure. Additionally, Advance has packaged a new Generic Content Management software, which is a web site content management tool for non-technical staff. The Company is currently in talks with a number of new clients interested in licensing this product. This is an example whereby, due to its centralised production facility, Advance could identify a common demand from different clients in different countries and successfully repackage its replicated solution into a potentially lucrative product. The information technology business environment remains weak. Sales cycles have increased from three months a year ago to over five months presently and the recent tragic events in America might weaken technology spending even further. Advance currently has #400,000 of work in progress and over #1.25 million in pipeline proposals but there is little visibility as to the timing and proportion of conversions into sales. Although our cash position at 30 September 2001 was #1.68m, it is difficult at this stage to determine whether the company has sufficient cash to continue trading for the next twelve months. In this uncertain climate, your Board has initiated a review that is exploring a range of other strategic options including fund raising. The long-term prospects for the Internet Professional Services and Wireless industry remain good. However, the current lack of visibility over the next twelve months will prove to be a testing challenge. Barclay Douglas Chairman of the Board 4 October 2001 Advance Visual Communications PLC Consolidated Profit and Loss Account 12 months 9 months ended ended Note 30 June 30 June 2001 2000 # # Turnover Continuing operations 2,015,176 1,227,003 Acquisitions 38,607 - 2,053,783 1,227,003 Operating loss Continuing operations (2,569,035) (964,506) Acquisitions (86,279) - (2,655,314) (964,506) Net interest receivable/(payable) 77,302 (26,221) Loss on ordinary activities before taxation (2,578,012) (990,727) Tax on loss on ordinary activities (38,182) (8,397) Loss on ordinary activities after taxation for the financial year/period transferred from reserves (2,616,194) (999,124) Basic loss per ordinary share 2 (2.0)p (1.6)p Diluted loss per ordinary share 2 (2.2)p (1.6)p Consolidated Balance Sheet as at 30 June 2001 As at As at 30 June 30 June 2001 2000 # # Fixed assets as restated Intangible 2,102,457 1,841,196 Tangible 431,668 482,216 2,534,125 2,323,412 Current assets Stocks 176,452 66,926 Debtors 404,635 526,375 Cash at bank and in hand 2,287,166 - 2,868,253 593,301 Creditors: amounts falling due within one year (693,188) (783,384) Net current assets/(liabilities) 2,175,065 (190,083) Total assets less current liabilities 4,709,190 2,133,329 Creditors: amounts falling due after more than one (39,408) (195,035) year Net Assets 4,669,782 1,938,294 Capital and reserves Called up share capital 1,566,255 832,870 Share premium account 6,634,893 2,198,593 Merger reserve 1,562,799 1,328,184 Other reserves (25,721) 30,897 Profit and loss account (5,068,444) (2,452,250) Equity shareholders funds 3 4,669,782 1,938,294 Consolidated Cash Flow Statement 12 months 9 months ended ended 30 June 2001 30 June Note 2000 # # Net cash outflow from operating activities 4 (2,506,448) (901,009) Returns on investments and servicing of finance Interest received / (paid) 94,520 (13,615) Interest element of finance lease rentals (17,218) (12,606) Net cash inflow/(outflow) from returns on investments and servicing of finance 77,302 (26,221) Purchase of tangible fixed assets (186,442) (130,181) Disposal of tangible fixed assets 38,044 27,066 Net cash outflow from capital expenditure and financial investment (148,398) (103,115) Acquisitions and disposals Purchase of subsidiary undertaking (36,049) (35,450) Purchase of business - (70,000) Net cash acquired with subsidiary/business 16,455 17,485 Net cash outflow from acquisitions and disposals (19,594) (87,965) Net cash outflow before financing (2,597,138) (1,118,310) Financing Capital element of finance lease rentals (127,546) (78,246) Repayment of long term loans (69,000) (92,550) Issue of ordinary share capital 5,758,346 1,455,667 Expenses paid in connection with issue of shares (664,048) - Warrant instrument - 31,348 Net cash inflow from financing 4,897,752 1,316,219 Increase in cash 2,300,614 197,909 12 months 9 months ended ended Statement of Total Recognised Gains and Losses 30 June 2001 30 June 2000 # # Loss for the financial period (2,616,194) (999,124) Currency translation differences (25,270) (451) Total recognised gains and losses relating to the (2,641,464) (999,575) year/period Notes on the Preliminary Results 1. The financial information set out above does not constitute full accounts within the meaning of Section 240 of the Companies Act 1985. Full accounts for the year ended 30 June 2001 will be posted to shareholders as soon as possible. The full accounts for the year ended 30 June 2001 have yet to be signed. The auditors have reported on the audited accounts for the 9 months ended 30 June 2000; their report was unqualified and did not contain any statements under section 237 (2) and (3) of the Companies Act 1985. 2. The calculation of earnings per share is based on the loss attributable to shareholders and the weighted average number of ordinary shares in issue of 133,465,550 (2000: 62,085,858). The calculation of diluted earnings per share is based on the loss attributable to shareholders and the adjusted weighted average number of ordinary shares of 121,600,550 (2000: 62,085,858). 3. Reconciliation of movements in 12 months ended 9 months ended shareholders' funds 30 June 2001 30 June 2000 # # Loss for the financial period (2,616,194) (999,124) Issue of warrants - 103,500 Issue of shares 6,040,500 2,917,491 Expenses paid in connection (664,048) - with issue of shares Shares to be issued - (150,000) Exchange rate movement (25,270) (451) Transfer to profit/loss of (3,500) - lapsed warrant instrument Net addition to shareholders 2,731,488 1,871,416 funds Opening shareholders funds 1,938,294 66,878 Closing shareholders funds 4,669,782 1,938,294 12 months ended 9 months ended 4. Reconciliation of operating loss to net cash outflow from 30 June 2001 30 June 2000 operating activities # # Operating loss (2,655,314) (964,506) Depreciation 185,051 93,010 Amortisation of intangible 101,430 32,694 assets Loss on disposal of tangible 25,556 16,834 fixed assets Provision against investment 25,000 - Increase in stock (109,526) (21,926) Decrease/(increase) in debtors 125,531 (202,260) (Decrease)/increase in (152,558) 145,145 creditors Non cash movements (51,618) - Net cash outflow from operating (2,506,448) (901,009) activities 5. The Registered Office of the Company is The Dyehouse, Dyehouse Drive, West 26, Bradford, BD19 4TY. Copies of the Annual Report and Accounts may be obtained from the Company Secretary at this address. 6. This announcement has been prepared on the basis of the accounting policies as stated in the previous years financial statements. The group adopted Financial Reporting Standards, which became applicable during the year, the effects of which are as follows: FRS 18: The standard has been adopted during the year, however this has had no effect on the reported figures. In addition, these financial statements have been prepared on the going concern basis. The directors have prepared budgeted cashflows which, assume a low level of growth, and which indicate the company may not have sufficient financial resource for the foreseeable future. As a result the directors have initiated a strategic review of the group and are considering a range of options including fund raising from various sources. If such funding is not available then adjustments will be required to the carrying value of assets and liabilities as set out in these financial statements. 7. The #1,328,184 share premium movement recorded in the prior year relating to the acquisition of Voxel SA has been reclassified under Section 131 of the Companies Act as a merger reserve rather than as a share premium.
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